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Judgment
J.K. Ranka, J.—Instant sales tax revision petition is directed against the order dated January 14, 2005 passed by the Rajasthan Tax Board, Ajmer in Appeal No. 822/2004/Jaipur whereby the appeal filed by the Revenue has been dismissed. It may be observed that a Larger Bench was constituted by honourable the Chief Justice to resolve and decide the following questions framed after noticing a conflict of opinions in the Division Bench judgments of this court in Parasnath Granite India Ltd. Vs. State of Rajasthan and Another, , decided on June 2, 2004, and in Maharana Talkies v. State of Rajasthan (D.B. Civil Special Appeal No. 858 of 1994), reported in [2004] 19 Sales Tax Today 239 , decided on November 29, 2004, as well as Lalji Mulji Transport Company Vs. State of Rajasthan and Another, , as follows:
"(i) Whether requirement of mens rea is relevant for the purpose of determining the liability for penalty in terms of section 78, sub-section (5) of the Rajasthan Sales Tax Act, 1994?
(ii) Whether the mens rea is required to be proved as a necessary ingredient for imposition of penalty under sub-section (5) of section 78 on proven violation of sub-section (2) of section 78 of the Rajasthan Sales Tax Act, 1994?
(iii) Whether in view of the amendment to rule 55 of the Rajasthan Sales Tax Rules, 1995 pursuant to the decision of the honourable Supreme Court in the case of State of Rajasthan and Another Vs. M/s D.P. Metals, , on sufficient cause being shown whether any authority empowered would be justified in not imposing the penalty in the absence of mens rea being proved?
(iv) Whether the mens rea is required to be proved as a necessary ingredient for imposing of penalty under sub-section (5) of section 78 on proved violation of sub-section (2) of section 78 of the Rajasthan Sales Tax Act, 1994?"
The Larger Bench of this Court vide order dated February 26, 2015 passed in Sales Tax Revision Petition No. 92 of 1999 ( Assistant Commercial Taxes Officer Vs. Indian Oil Corporation Ltd.--> ) and other connected revision petitions has answered the questions as follows (pages 223 and 224 in 82 VST):
"(i) The requirement of mens rea is not relevant for the purpose of determining the liability for penalty, in terms of section 78(5) of the RST Act, 1994.
(ii) The mens rea is not required to be proved as necessary ingredient for imposition of penalty under sub-section (5) of section 78, on proving violation of sub-section (2) of section 78 of the RST Act, 1994.
(iii) The amendment to rule 55 of the RST Rules, 1995, in pursuance of the decision of the honourable Supreme Court in State of Rajasthan and Another Vs. M/s D.P. Metals, , authorises the authority empowered, to make an enquiry of violation of section 78(2), and not to adjudicate as to whether the mens rea was present in violation of sub-section (2) of section 78, for imposing penalty under sub-section (5) of section 78 of the RST Act, 1994.
(iv) The mens rea is not required to be proved as necessary ingredient for imposition of penalty under sub-section (5) of section 78, on proving violation of sub-section (2) of section 78 of the RST Act, 1994."
After answering the questions in the case of Assistant Commercial Taxes Officer Vs. Indian Oil Corporation Ltd.--> and other connected sales tax revisions, were ordered to be sent back and listed before the Bench having jurisdiction to decide the matters, in accordance with the opinion given and the answers provided by the Larger Bench on such opinion, accordingly the instant revision petition is being decided.
The brief facts, which can be noticed, are that the goods of respondent-assessee were being transmitted on June 23, 1999 in Truck No. RJ-14-G-8889, which was checked at Bharatpur Check-post, and vehicle containing 194 sacks of groundnut and 28 sacks of gram bearing bilty No. 380 dated June 22, 1999 and bill No. 111 dated June 22, 1999 was found with the vehicle and the sale invoice was also noticed. However, at the time of inspection, declaration form ST-18C, which was mandatory, was not produced, and prima facie the assessing officer was of the view that penalty under section 78(5) of the Rajasthan Sales Tax Act, 1994 (for short, "the RST Act") is leviable and therefore, a show-cause notice was issued for hearing on July 8, 1999. However, the representative of the assessee appeared on the spot on June 23, 1999 itself and requested for hearing, and accordingly the matter was heard. The assessee contended that they were not aware of the provisions of sales tax laws, however, they produced the declaration form ST-18C bearing No. 1886/01 duly filled, signed and sealed before the assessing officer. The assessing officer was not satisfied with the explanation so offered, and contended that declaration form ought to have been with the vehicle and to produce the same on the spot accordingly levied penalty under section 78(5) of the RST Act.
The matter was challenged in appeal before the Deputy Commissioner (Appeals), who allowed the same in the light of the judgment rendered in the case of State of Rajasthan and Another Vs. M/s D.P. Metals, : [2002] 1 SCC 279 . The Revenue carried the matter before the Tax Board, who upheld the order of the DC (A) and deleted the penalty.
Counsel for the Revenue contended that carrying of the declaration form ST-18C was mandatory, and it ought to have been carried in the vehicle and to be produced at the time of checking of the vehicle, and contended that once the declaration form was not found, providing the same later on was not proper, and the Tax Board was unjustified in coming to the said conclusion. He further contended that the assessee admitted that since the goods were being sent outside the State of Rajasthan, the declaration form ST-18C should have been with the vehicle and thus the order of the Tax Board deserves to be reversed. He further contended that in the light of the judgment rendered by the honourable apex court in the case of Guljag Industries Vs. Commercial Taxes Officer, and Larger Bench of this Court in Assistant Commercial Taxes Officer Vs. Indian Oil Corporation Ltd.--> mens rea is not essential and once the clear-cut finding by the assessing officer that the goods were being transmitted with the intention of evasion of tax, then the order of the lax Board deserves to be reversed.
No one has put in appearance on behalf of the respondent despite service.
I have considered the arguments advanced by the counsel for the Revenue. In my view, the order of the Tax Board deserves to be upheld for the reason that the declaration form, which was obtained by the assessee, was available with them, and which was produced immediately on demand, and even on the same day of intercepting the vehicle. Admittedly, it is not a case that the declaration form was obtained subsequent to the dispatch of the goods or after being intercepted by the authorized officer of the Revenue, and admittedly the vehicle was checked on June 23, 1999 on an information giving by the vehicle incharge to the assessee, he appeared before the authorized officer himself on the same day, i.e., June 23, 1999 and produced declaration form ST-18C, therefore, once it is a finding of fact given by the assessing officer that the declaration form was produced on the same day on June 23, 1999 when the vehicle was intercepted, in my view, in the light of the judgment rendered by the honourable apex court in the case of State of Rajasthan and Another Vs. M/s D.P. Metals, and in the light of the rule 54 of the RST Rules, which postulate that principle of natural justice demand that an opportunity should be given and therefore, it is a clear cut case where the declaration form, though mandatory, required to be carried with the vehicle but the driver/vehicle incharge forgot to carry the same, which was immediately produced on demand that too on same day.
Certainly in the light of the judgment rendered by the honourable apex court in the case of Guljag Industries Vs. Commercial Taxes Officer, and Larger Bench of this court in Assistant Commercial Taxes Officer Vs. Indian Oil Corporation Ltd.--> mens rea is not essential and therefore, insofar as the observations of the Tax Board about mens rea is concerned, such finding deserves to be reversed but for the reason aforesaid, the penalty has rightly been deleted by the Tax Board. Accordingly, I do not find any infirmity or illegality in the order impugned and on such finding of fact that the declaration form which was already obtained by the assessee prior to the dispatch of the goods, was produced immediately on demand. In my view, no penalty in law is leviable and accordingly the question of law is answered in favour of the assessee and against the Revenue. No costs.